Disruptions in the Strait of Hormuz could push small and medium-sized businesses out of global supply chains, increasing economic concentration and weakening the resilience of international trade, Reuters reports citing a report by the United Nations Conference on Trade and Development.
Rising energy bills, freight rates, insurance premiums and financing constraints sparked by the US-Iran war place heavier burdens on small and medium-sized enterprises (SMEs) than on large firms, leaving them more vulnerable than large corporations that can diversify suppliers, markets and funding sources.
SMEs account for around 90 per cent of global businesses, 70pc of employment and 50pc of world GDP, according to the report, meaning the disruptions risk ripple effects far beyond the shipping lanes.
